Background: Diabetic retinopathy is common complaint for visual disturbances in patients with Diabetes mellitus. Statins can effectively decrease the lipid parameters along with improvement in visual acuity. This study was undertaken in order to assess effect of use of statins on diabetic retinopathy/ diabetic macular edema in patients with type 2 diabetes mellitus. Methodology: A prospective study was undertaken in 100 patients in Basaveshwara Medical College and Hospital, Chitradurga. The patients undergone examination for visual acuity, fundoscopic examination for progression of diabetic retinopathy and macular edema, total cholesterol, LDL Cholesterol and Triglycerides. The patients were followed for 12 months and same readings were obtained at the follow up. Results: This study had shown that, majority of the cases were aged more than 60 years and were males. The mean duration of the diabetes mellitus was 15.9 years. The visual acuity in this study was improved as per Logmar vision. The CSME was present in 10.0% of the left eye and 13.0% of the right eye of the patients. The use of statins on the patients have significantly reduced the severity of diabetic retinopathy in both left and right eyes in this study. The lipid profile of the patients had shown significant decrease in Total cholesterol, Triglycerides and LDL cholesterol levels after use of statins. Conclusion: This study had shown the improvement of visual acuity, decrease in severity of CSME and diabetic retinopathy along with decrease in lipid parameters.